Henry Schein Inc (NASDAQ:HSIC) brass say global dental market growth remains steady, flat to low-single digits by region.
The company’s management reaffirmed its expectations for dental equipment growth in the second half. CEO Stan Bergman and CFO Ron South also emphasized the strong customer retention gained from the second-quarter promotions.
From a high level, management sees the global dental market as stable, with no significant shifts in recent months.
Piper analyst Jason Bednar, who met with Bergman and South, remains confident in the Q2 outlook.
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Henry Schein drove more substantial volumes in Q2 by offering promotions to price-sensitive customers, although this weighed on gross margins.
Management notes retention remains solid, supported by multi-month customer commitments tied to those promotions. While this provides near-term visibility, margins and revenue could face pressure once the commitment period ends.
Management has withheld details on the two KKR value creation initiatives discussed last quarter, with timing and impact expected to be addressed on the third-quarter call in November.
Early indications suggest that P&L benefits may be modest in the near term, as savings could be offset by reinvestment, resource shifts, and initiatives requiring a longer runway to materialize.
Dental manufacturers have implemented selective price hikes as tariffs take hold and cheaper inventory runs out. Henry Schein stated that it is fully passing through increases from branded suppliers and is doing the same for private-label lines.
Management noted dentists are more receptive to targeted adjustments than broad-based hikes.
Price Action: HSIC stock is up 2.24% at $69.44 at the last check on Tuesday.
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